‘Cashie’ jobs, businesses now on ATO crackdown radar

“Keeping such transactions ‘off the books’ is not a mistake – it’s a deliberate action that affects everyone.”

It was noted by the ATO that any business which failed to report all sales transactions, issue receipts, avoid paying GST, income tax, PAYG withholding, super guarantee, insurance and work cover protection would fall into the areas it would be cracking down on.

Also falling into the ATO’s spotlight were businesses reporting their income below the $75,000 threshold to avoid registering for GST, exploiting workers by not meeting award conditions and work cover protections, as well as undercutting honest businesses by offering lower cash prices.

“This behaviour creates an unfair playing field for those businesses doing the right thing. It undermines the integrity of the tax system, erodes public trust and reduces funding for essential services like hospitals, schools and roads,” the ATO said.

“We use sophisticated data and analytics to deter businesses that aren’t doing the right thing. Our compliance teams, along with joint operations across government agencies, are actively targeting cash-only businesses that deliberately avoid their obligations.”

It was noted that those businesses that paid their workers cash-in-hand, or working ‘off the books’, were putting their workers at a disadvantage.

This was based on those workers usually missing out on entitlements such as paid holidays and sick leave, a wage less than that of the award wage, end-of-year tax liabilities if no tax was withheld from their pay, no entitled super payments, and a lack of coverage under WorkCover for workplace injuries.

In its warning, the ATO provided an example of a business not following its obligations that incurred multiple penalties.

The Tax Office said a pizza restaurant had operated mostly on a cash-only basis, with some payments made through PayID, as well as earning income from an ATM installed at the shopfront, which customers were often told to withdraw cash from to pay for their orders.

According to the ATO, this business failed to keep accurate records and report all of their income, which resulted in an audit in 2023 and landed the business with a 50 per cent penalty for reckless behaviour.

 Following this, a second audit was carried out in the 2024 income year after a community tip-off, which found the pizza restaurant had not reported around $140,000 in income, and about $80,000 in expenses claimed without proof.

The ATO said it considered this behaviour to be intentional and not just a mistake, before issuing adjustments to GST reporting resulting in a GST shortfall of over $17,400, a 75 per cent penalty for intentional disregard, a 20 per cent uplift on the GST shortfall resulting in penalties of over $11,500, and a shortfall penalty of over $38,000 for false and misleading statements.

The ATO urged all businesses to report all income (including cash), pay workers correctly, meet employer and super obligations, keep accurate records and digital tools, as well as registering for GST.

“Small businesses often rely on tax professionals to help them stay on top of their tax and super obligations. These professionals play a vital role in supporting the integrity of the system by asking the right questions about cash income and ensuring businesses report correctly.”